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According to a statement by Pertamina issued on August 8, PGN and PT LNG signed a memorandum of understanding to explore the potential for LNG cooperation in East Java.
Under the MoU, the two firms have agreed to explore various areas of cooperation, including PGN’s ongoing LNG trading activities to meet domestic gas demand, the statement said.
In order to support domestic market needs, PGN and PT LNG will conduct a joint study on the development of natural gas infrastructure or an LNG terminal in Pasuruan, East Java.
The duo will also study other related potential operation and maintenance activities of natural gas or LNG facilities and infrastructure, the statement said.
PT LNG’s website shows that the firm offer solutions for LNG supply, storage, and regasification.
The company makes “virtual pipelines” by using trucks to deliver LNG to industrial and power users as well as the transport sector.
PGN’s Rosa Permata Sari noted in the statement that there is a “high demand” for natural gas on the island of Java, but fulfilling the gas needs in certain areas still requires various modes of transportation.
This does not only include pipeline gas but also CNG and LNG.
Furthermore, she said that the retail industry is growing “quite rapidly”.
“Regardless on pricing, it feels like the market is ready to accept LNG penetration. We saw the market’s ability to absorb LNG from last May. This means that the LNG ambience and ecosystem have been formed,” she said.
Lampung FSRU
Earlier this year, PGN resolved its dispute with Norwegian FSRU player Hoegh LNG over issues related to the Lampung FSRU charter.
The 2014-built 170,132-cbm FSRU serves a 20-year charter deal with PGN LNG, a unit of PGN, off the southeast coast of Sumatra in Indonesia.
The underutilized 2.7 mtpa facility completed in November last year its 52nd ship-to-ship operation since it started operations in 2014.
Connected to a tower yoke mooring system, the unit delivers gas via a 21 km long offshore pipeline.
The regasified LNG from the FSRU-based facility goes for power generation and industrial users in West Java.
